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Jan 21, 2013

Mark Stein, Krugman, and the trillion-dollar coin

Mark Stein has an amusing take on the news on arriving back from a trip out of the country.  This includes the media falling for a story about a football player’s imaginary dead girlfriend, 23 executive orders designed by kids, and the rather ludicrous call for the minting of a one trillion dollar coin.
Back in the Reagan era, a Doonesbury strip was published in which Duke has arrived back from one of his mysterious trips away and was being brought up to speed on the Iran Contra affair.  After hearing of illegal arms sales to Iran with the proceeds diverted illegally to fund the Contra militants in Honduras, he rings his PA and asks her to check what medication he is on.
While I was abroad, a Nobel Prize–winning economist, a Harvard professor of constitutional law, a prominent congressman, and various other American eminencies apparently had a sober and serious discussion on whether the United States Treasury could circumvent the debt constraints by minting a trillion-dollar platinum coin. Although Joe Weisenthal of Business Insider called the trillion-dollar coin “the most important fiscal policy debate you’ll ever see in your life,” most Democrat pundits appeared to favor the idea for the more straightforward joy it affords in sticking it to the House Republicans. … 
The trillion-dollar-groat fever rang a vague bell with me. Way back in 1893, Mark Twain wrote a short story called “The Million Pound Bank Note,” which in the Fifties Ronald Neame made into a rather droll film. A penniless American down and out in London (Gregory Peck) is presented by two eccentric Englishmen (Ronald Squire and Wilfrid Hyde-White) with a million-pound note which they have persuaded the Bank of England to print in order to settle a wager. One of the English chaps believes that simple possession of the note will allow the destitute Yank to live the high life without ever having to spend a shilling. And so it proves. … I always liked the line Mark Twain’s protagonist uses on a duke’s niece he’s sweet on: He tells her “I hadn’t a cent in the world but just the million pound note.” 
That’s Paul Krugman’s solution for America as it prepares to bust through another laughably named “debt limit”: We’d be a nation that hasn’t a cent in the world but just a trillion-dollar coin — and what more do we need? As with Gregory Peck in the movie, the mere fact of the coin’s existence would ensure we could go on living large. Indeed, aside from inflating a million quid to a trillion bucks, Professor Krugman’s proposal economically prunes the sprawling cast of the film down to an off-Broadway one-man show with Uncle Sam playing every part: A penniless Yank (Uncle Sam) runs into a wealthy benefactor (Uncle Sam) who has persuaded the banking authorities (Uncle Sam) to mint a trillion-dollar coin that will allow Uncle Sam (played by Uncle Sam) to extend an unending line of credit to Uncle Sam (also played by Uncle Sam). 
This seems likely to work. As for the love interest, in the final scene, Paul Krugman takes his fake dead girlfriend (played by Barack Obama’s composite girlfriend) to a swank restaurant and buys her the world’s most expensive bottle of champagne (played by Lance Armstrong’s urine sample). …
In fairness to Krugman, he is a witty satirical writer for the New York Times, who’s rather quirky and off the planet ideas are sometimes taken seriously by political pundits, possibly due to his Nobel Prize in economics.  He is great for filling the gap when The Onion or The People’s Cube don’t post. 
His endorsement of the trillion dollar coin should not be taken too seriously, given the terms he uses to argue for it: 
“It’s easy to make sententious remarks to the effect that we shouldn’t look for gimmicks, we should sit down like serious people and deal with our problems realistically. That may sound reasonable — if you’ve been living in a cave for the past four years.Given the realities of our political situation, and in particular the mixture of ruthlessness and craziness that now characterizes House Republicans, it’s just ridiculous — far more ridiculous than the notion of the coin.”
In other words, he is claiming that the very idea of Republicans opposing the will of President Obama (All heil the great leader) is absolutely ridiculous, and it is therefore sensible to do something ridiculous in response to this.


  1. The banksters would refuse this coin in payment of the nation's debt by suggesting that it is worthless, having been made from nothing out of nothing of value. - To which the reply should be - 'You know what - so was the money we borrowed from you in the first place!'

  2. profoundly_disturbedJanuary 22, 2013 at 9:31 AM

    G'day mate

    I read this post yesterday, couldn't respond, I'm still laughing